Taxes Consolidation Act 1997 section 835M

Determination of residence

Section 835M sets out the rules for determining the territory of residence of a controlled foreign company (CFC) for the purposes of the CFC regime.

• A CFC is resident in the territory where it is subject to tax by reason of domicile, residence or place of management; where two or more territories qualify, tie-breaker rules apply based on place of effective management and then asset location.
• If no territory qualifies under the main rules, the CFC is treated as resident where it is incorporated or formed.
• Company assets are valued at market value immediately before the end of the accounting period, construed in accordance with section 548.
• A double tax treaty determination of residence under section 826(1) takes precedence over all other rules in this section.